Financial Constraints No Grounds To Deny Medical Reimbursement To Retd Employees: Punjab & Haryana High Court

The Punjab & Haryana High Court has held that the Haryana Police Housing Corporation cannot deny medical reimbursement to its retired employees on the ground of financial constraints, quashing two orders that had denied the benefit to former staff members. The Court reiterated that once medical reimbursement is part of the service conditions, retired employees cannot be placed in a disadvantaged class vis-à-vis serving employees.

Justice Harpreet Singh Brar said, "this Court cannot lose sight of the fact that a public body such as the respondent/Corporation cannot shrug off its responsibility to extend the medical reimbursement benefits to its retired employees by simply citing financial difficulties. The Corporation has availed the services of these employees during the prime and youthful years of their lives. After retirement, when age- related health problems begin, these employees need medical care and reimbursement the most. To deny medical reimbursement, at this stage, is wholly arbitrary and unreasonable."

The petitioners, all retired employees of the Corporation, had approached the Court seeking (i) a writ of mandamus directing extension of medical reimbursement facilities and (ii) quashing of orders, which denied such benefits.

On 16.07.2025, the Court had noted that the Corporation was extending medical facilities to serving employees but denying the same to retired employees—an approach already rejected by a Division Bench in Housing Board Haryana v. Krishan Chander (19.05.2022), a judgment later affirmed by the Supreme Court.

Respondents (the Corporation and its officials) subsequently filed their written statement, asserting that due to poor financial health, they could not reimburse medical claims of retired personnel and that reimbursements were to be considered year-to-year depending on fiscal viability.

Petitioners countered this by relying on the Division Bench ruling in Krishan Chander and its affirmation in SLP (C) No.14826/2022 – Housing Board Haryana v. Yatindra Kumar Gupta, wherein the Supreme Court categorically held that retired employees are entitled to medical reimbursement at par with State Government employees and serving employees of the Board.

The Court observed that the issue was no longer res integra. The very argument of financial incapacity raised by the Corporation had already been rejected by the Division Bench in Krishan Chander and by the Supreme Court in Yatindra Kumar Gupta.

Quoting the Supreme Court's reasoning in Housing Board Haryana and others vs. Yatindra Kumar Gupta and others, passed in SLP (Civil) No.14826 of 2022, the Court highlighted:

“we agree with the High Court that the benefit of medical reimbursement is made available to the employees of the Housing Board, Haryana, and therefore to single out the retired employees to deny them this benefit, contrary to the terms of the appointment letter and the 2006 Regulations, would be wrong.”

Retired Employees Cannot Be Carved Into An Inferior Class

Relying also on A.K. Bhatnagar v. State of Haryana, the Court reiterated that whenever a resolution or service condition applies to “employees,” it includes retired employees unless expressly excluded. Creating artificial distinctions between serving and retired staff for medical reimbursement violates Article 14.

Corporation Cannot Evade Responsibility Toward Retired Staff

The Court made strong remarks on the duty of the public body:

“A public body cannot shrug off its responsibility to extend medical reimbursement benefits to its retired employees by citing financial difficulties. These employees served during their prime years; denying them medical reimbursement in old age is arbitrary and unreasonable.”

The Court noted that no material was produced to show that medical reimbursement was lawfully withdrawn before the petitioners retired.

Quashing the impugned order, the Court directed the respondents to release admissible medical reimbursement to the petitioners in accordance with applicable rules and legal precedents.

It further ordered compliance within two months of receiving the certified copy and held that failure to pay within the stipulated period would attract 6% per annum interest from the date of default until actual payment.

Mr. Dinesh Kumar, Advocate with Ms. Bhoomika, Advocate for the petitioners.

Mr. Saurabh Girdhar, AAG, Haryana.

Ms. Rajni Gupta, Advocate for respondents No.4 and 5.

Title: Gurcharan Dass and others v. State of Haryana and others

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